Why Boycotts Succeed—and Fail
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Organizations Leadership Policy Apr 1, 2009

Why Boy­cotts Suc­ceed — and Fail

Iden­ti­fy­ing cor­po­rate vul­ner­a­bil­i­ties that can lead to dam­aged reputations

Based on the research of

Brayden King

Listening: Interview with Brayden King

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What fac­tors deter­mine whether a boy­cott will suc­ceed in chang­ing the behav­ior of its cor­po­rate tar­get? And how can activists attack the weak points of their adver­saries most effec­tive­ly? A study by Bray­den King of Kellogg’s Man­age­ment & Orga­ni­za­tions depart­ment seeks to answer those ques­tions. His short answer: Activists seek­ing to cre­ate cor­po­rate change are part­ly depen­dent on the con­di­tions of the com­pa­ny they’re tar­get­ing. It has to be vul­ner­a­ble to change to have any trans­for­ma­tive effect.”

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Boy­cotts have been described as the weapon of the weak, since sec­ondary stake­hold­ers gen­er­al­ly use them in efforts to insti­gate change. How­ev­er, King’s research offers a posi­tion of strength to oth­er­wise mar­gin­al actors, iden­ti­fy­ing two con­di­tions that pre­dis­pose boy­cotters to be able to shape and con­strain their more pow­er­ful cor­po­rate tar­gets and win con­ces­sions. King’s results reveal that com­pa­nies that have expe­ri­enced a decline in pub­lic rep­u­ta­tion are more sus­cep­ti­ble to boy­cotts, and that the more media atten­tion a boy­cott receives, the greater its effec­tive­ness will be.

Suc­cess­ful Boy­cotts: A Ven­er­a­ble History

Activists began to use boy­cotts even before 1880, when Irish employ­ees refused all col­lab­o­ra­tion with ruth­less Eng­lish land agent Cap­tain Charles Cun­ning­ham Boy­cott, thus giv­ing the action its name. In 494 BC, plebs protest­ed their harsh treat­ment by the patri­cians whom they served by pack­ing up and leav­ing Rome. They returned only when their bereft mas­ters gave them con­ces­sions. Recent suc­cess­es include the Mont­gomery bus boy­cott of 1955 that helped launch the civ­il rights move­ment and the Unit­ed Farm Work­ers’ grape boy­cott in the late 1960s that won bar­gain­ing rights for farm labor­ers in Cal­i­for­nia and oth­er West­ern states. In May 2001 Toy­ota Motor Cor­po­ra­tion can­celed a tele­vi­sion adver­tise­ment that depict­ed an African-Amer­i­can with a tooth inlaid with a Toy­ota insignia after the Rain­bow Coali­tion accused the com­pa­ny of rein­forc­ing neg­a­tive stereo­types and threat­ened a boy­cott. Toy­ota respond­ed fur­ther to the threat by extend­ing its rela­tion­ships with minor­i­ty-owned businesses.

Com­pa­nies that have expe­ri­enced a decline in pub­lic rep­u­ta­tion are more sus­cep­ti­ble to boycotts.Trained as a polit­i­cal and orga­ni­za­tion­al soci­ol­o­gist, King brought his inter­est in social change and the role of activists to a key ques­tion about boy­cotts. Sub­stan­tive­ly, I’m inter­est­ed in under­stand­ing why they are effec­tive,” he explains. A lot of research in the past has shown that they don’t nec­es­sar­i­ly affect their tar­gets’ bot­tom lines that much. And it’s not clear that boy­cotts affect con­sumer behav­ior very much. But those boy­cotts that get some lev­el of media atten­tion are rel­a­tive­ly suc­cess­ful in terms of get­ting some sort of con­ces­sion out of their targets.”

Media, Drop­ping Sales, and Reputation

King start­ed with five hypothe­ses about boy­cotts. Three made more gen­er­al asser­tions that cor­po­rate tar­gets are more like­ly to con­cede to boy­cotts when high lev­els of media atten­tion are gen­er­at­ed, the cor­po­ra­tions have suf­fered a decline in sales rev­enue, and the cor­po­ra­tions have expe­ri­enced a decline in rep­u­ta­tion. The remain­ing two sought to pin­point more specif­i­cal­ly the inter­ac­tion effects between media atten­tion and sales decline on the one hand and media atten­tion and rep­u­ta­tion decline on the other.

To test the hypothe­ses, King exam­ined boy­cotts against elite, pub­licly trad­ed cor­po­ra­tions report­ed in five geo­graph­i­cal­ly dis­trib­uted nation­al Amer­i­can news­pa­pers between 1990 and 2005. He then set out to dis­cov­er why 53 of the 144 firms in the sam­ple con­ced­ed to the boy­cotters’ demands.

It is rea­son­able to assume that cor­po­rate deci­sion mak­ers viewed boy­cotts as a more seri­ous threat to their rep­u­ta­tion than to their sales revenue.”

His find­ings con­firm his hypoth­e­sis with respect to the impor­tance of the media, but with a sur­pris­ing twist. As pre­dict­ed, boy­cotts are indeed more like­ly to exert influ­ence when they receive a great deal of media atten­tion. Inter­est­ing­ly though, his results indi­cate that even with media cov­er­age, pre­vi­ous sales declines have sta­tis­ti­cal­ly insignif­i­cant bear­ing on whether a boy­cott will ulti­mate­ly bear fruit for activists. Instead, the real pow­er of a boy­cott lies in its abil­i­ty to inflict dam­age to cor­po­rate rep­u­ta­tion. King observes that cor­po­ra­tions that strug­gle with their pub­lic image are more like­ly to take boy­cott demands seri­ous­ly, where­as cor­po­ra­tions with strong rep­u­ta­tions feel more imper­vi­ous to such demands and are more like­ly to stick to their guns” regard­less of sales lev­els. Thus, he calls it rea­son­able to assume that cor­po­rate deci­sion mak­ers viewed boy­cotts as a more seri­ous threat to their rep­u­ta­tion than to their sales rev­enue.” This find­ing, he con­tin­ues, helps make sense of pre­vi­ous stud­ies that have ques­tioned why boy­cotts are ever effec­tive, giv­en that most boy­cotts do not involve large num­bers of par­tic­i­pants and do not usu­al­ly have a large impact on the sales of the cor­po­rate target.”

Boy­cotts may not need to affect sales at all in order to be effec­tive,” he writes. Rather, boy­cotters’ influ­ence stems from their abil­i­ty to make neg­a­tive claims about the cor­po­ra­tion that gen­er­ate neg­a­tive pub­lic per­cep­tions of the cor­po­ra­tion. Hence, cor­po­ra­tions that are already strug­gling to main­tain their pre­vi­ous­ly pos­i­tive rep­u­ta­tions will be more like­ly to con­cede to boy­cotts and quell any fur­ther dam­age the boy­cott may do to their reputation.”

King notes that the study has one iron­ic con­clu­sion: Com­pa­nies with poor rep­u­ta­tions to begin with are less vul­ner­a­ble to boy­cotts, because they have less to lose.”

Advice for Both Boy­cotters and Companies

What les­son does the study hold for poten­tial pro­tes­tors? Choose your com­pa­ny care­ful­ly,” King advis­es. The best tar­gets are com­pa­nies with good rep­u­ta­tions that are on the decline. Of course, activists don’t always have a choice. But if they can choose among var­i­ous com­pa­nies, choose those with a pub­lic image cri­sis.” King has one oth­er crit­i­cal piece of advice: Have a plan to involve the media from the very begin­ning,” he says.

What can com­pa­nies who are poten­tial tar­gets of activism take from this research? They need to be aware that they are respon­si­ble to stake­hold­ers, and their rep­u­ta­tion is an impor­tant and valu­able asset,” King points out. Com­pa­nies that haven’t done the best to nur­ture their pub­lic image in the past are the ones that can lose their auton­o­my in their deci­sion mak­ing. They need to be active about the man­age­ment of their pub­lic images.”

Fur­ther reading:

More on this research in Pro­fes­sor Bray­den King’s blog at orgth​e​o​ry​.word​press​.com/​2009​/​04​/​04​/​h​o​w​-​p​r​o​t​e​s​t​s​-​m​a​tter/.

Featured Faculty

Brayden King

Max McGraw Chair in Management and the Environment, Professor and Department Chair of Management & Organizations

About the Writer

Peter Gwynne

About the Research

King, Brayden G. (2008), “A Political Mediation Model of Corporate Response to Social Movement Activism,” Administrative Science Quarterly, 53(3): 395-421.

Read the original

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